Tender results showing lower-than-expected bids for two Government Land Sale sites in Singapore could be a sign of things to come, Colliers International says.

The Urban Redevelopment Authority announced the top bids for GLS allotments in Irwell Bank Road and Bartley Road/Jalan Bunga Rampai, both of which it said were below expectations.

According to the URA, Irwell Bank Road had seven bids, the largest of which came from CDL Perseus and was about 11 per cent lower than its earlier expectations of SGD1,700 psf ppr.

At a glance:

• The Urban Redevelopment Authority has announced the Government Land Sales tender results for two sites – Irwell Bank Road and Bartley Road/Jalan Bunga Rampai.
• The top bids for both sites were below expectations, although they did attract a healthy number of bids.
• Colliers International believes a mix of market uncertainty, ample upcoming supply and cooling measures is prompting developers to adopt a more conservative approach.

Of the nine bids submitted for Bartley Road/Jalan Bunga Rampai, the top bid was SGD885 psf ppr from Wee Hur Development, slightly below the expected amount of SGD900 psf ppr.

Colliers International Singapore Head of Research Tricia Song said while there was keen interest in acquiring the land, developers appeared to be "bottom fishing" with the amounts being offered,

"The bids that were submitted for both GLS sites – Irwell Bank Road and Bartley Road/Jalan Bunga Rampai – were lower than expected, further giving evidence to the cautious sentiment among developers as they continue to adopt a more prudent approach to land bids, amid market uncertainties, ample upcoming supply, and the cooling measures which remain in place," she said.

"They are also perhaps mindful of potential risks, including the more subdued economic growth and the ABSD penalty.

"To this end, we believe developers will continue to take a conservative approach in acquiring sites."

The URA is set to announce the winning bid for each site in the coming weeks.

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